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madcowmonkey-

How did you know I was laughing? Are you one of my unseen benefactors?

Anyway, HOA's are just a fraction of the approximately 1.5-2.5 jillion dollars hidden costs to buying a house. There are only about half a jillion dollars in hidden costs when renting, and even aside from the difference in hidden costs there is a much higher monthly cost to paying a mortgage, and when you invest that difference and what you would use as a down payment in the S&P 500, you wind up much richer from 20 years of renting than 20 years of owning a home.

The reason people who own homes wind up richer than renters is because most renters either 1) have lower incomes or 2) much worse personal finance habits and less friendly forms of debt. Homeowners can demonstrate how rich they are by comparing themselves to people who don't save or invest at all, while they could have saved time and gotten a much better return on their investment by renting a large apartment and investing the savings in a mediocre index fund. That's not even with our stock-picking prowess figured in (which I believe, in our cases, is better than the S&P 500 - right, everyone?)

So if you want to paint your house a funny color or install an indoor pool or something, you have to own, but if you have an HOA, you can't anyway, and there's no point.

If you buy and rent out rooms to pay your mortgage, that would perhaps be a decent financial decision, but remember: houses are still near the peak of a bubble, and in most places rents will have to stay as high as they are as housing prices plummet in order for you to pay your mortgage by renting out.

Best of luck, madcowmonkey.

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